Companies join forces to save

The economic downturn is driving companies to collaborate on procurement to safeguard their businesses.

This month, German automotive suppliers Schaeffler Group and Continental joined forces in a bid to save up to ?400 million (£360 million) in two years through combined purchasing. Schaeffler is the biggest shareholder of Continental but the initiative is the first large joint project for the two companies.

And in another deal, Mitsubishi Chemical Corporation and China Petroleum & Chemical Corporation - known as Sinopec - released details of a partnership covering joint research, raw material and finished product supplies, logistics and other areas.

Professor Alan Braithwaite, chairman of supply chain consultancy LCP, forecast greater collaboration between companies as well as with suppliers, describing it as "the new critical factor in success". He added: "This is driven by need.